Every bit of value that can be taken from sourcing and procurement processes can help today's companies immensely. The move toward strategic sourcing has entailed a realization that there is money waiting to be reclaimed by businesses that effectively revise and improve their interactions with vendors.

Treating sourcing as its own strategic discipline, touching other elements of the business but not subservient to them, creates new avenues for savings and process improvement. Companies that fully commit to this approach can find exciting new opportunities that they may have taken for granted in the not-so-distant past.

The power of neutrality
Becoming truly strategic about sourcing and procurement decisions means putting everything on the table: According to Business.com contributor Andrew Durlak, companies that take a neutral approach to their current supply partners might find advantages and opportunities they've been overlooking. He advised organizations to put faith in their strategic sourcing tools, even when that means reexamining an existing contract or going in a new direction.

Departments that have been using one vendor for a long time may feel locked into that choice. Doing things one way feels natural, and thus renewing the contract may seem to have more of an efficiency factor than it really does, due to force of habit. Durlak urged against favoritism. Using digital data to contribute to supplier choice is one way to clear away the ambiguity and see what the real best deal is.

Tough questions are key. Durlak quoted research by The Harvard Business Review, in which Uber's Neil Aronson stated that trusting a strategic sourcing solution means getting to the heart of the matter, when stakeholders may be inclined to stick with an inefficient contract. Leaders willing to give their procurement departments the power to explore this way, rather than simply acting as cogs in the process of setting up contracts, are really embracing strategic sourcing.

Information is the future of procurement.

Analytics has arrived
The use of data to help decision-makers do their work has become a theme throughout all kinds of industries and functions over the past few years. Spend Matters, recapping a webinar by its founder Jason Busch, pointed out that the use of analysis is becoming an inseparable part of digital sourcing. Companies that have strategic sourcing platforms installed are crunching numbers more effectively than ever, and this is pointing them to better decisions.

Using data to determine supplier suitability is the opposite of being tied to contracts due to personal contacts or a hesitance to change. As solutions become more advanced, admitting more variables and taking important new information into account, these projections can become more precise, giving decision-makers an increasingly more granular and accurate view.

Busch added that in both analytics, in particular, and strategic sourcing, in general, ease of use is becoming a major trend. Procurement leaders today don't have to master dozens of esoteric computer systems to gain access to better insights. The tools they have at their disposal are increasingly easy to use, which is helping their chances of becoming truly mainstream tech options. The next steps for procurement in the digital age could lead to still more confident decision-making.

Strategic Sourceror

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Source One is a leading procurement services provider. Since 1992, Source One has been providing companies in all industries with sourcing services including BPO, Benchmarking, Spend Analysis, Category Support, and RFX Management.